Gifts by Spouse Cause Medicaid Ineligibility

A technical notice for consumers and Maryland elder law professionals.

In a dramatic shift in Medicaid policy, Maryland now will look at asset transfers by a spouse living in the community to determine whether the spouse in the nursing home may continue to receive Medicaid benefits. Previously, once Medicaid eligibility was granted, the community spouse could make gifts of assets or create a life estate deed with no adverse consequence to the spouse in the nursing home. Now, however, the Maryland Medicaid authorities state that such actions by the community spouse will cause the spouse in the nursing home to lose Medicaid benefits. Click the Contact Us link at the top of the page if you would like to learn more about this recent development in the law.

Intense Scrutiny for Third Party Trusts

A technical article for Maryland elder law professionals.

Elder law lawyers are familiar with third party trusts authorized by the Omnibus Budget Reconciliation Act of 1993 (OBRA ’93), which third party trusts are addressed in 42 U.S.C. 1396p(c)(2)(B). With such a trust an individual can set aside assets for a disabled person under age 65 and not cause such disabled beneficiary to lose Supplemental Security Income (SSI) or Medicaid benefits. Moreover, the person who creates and funds the trust will not become ineligible to receive such benefits as a consequence of funding the trust.

The Gatesman Law Office now is negotiating with the Maryland Medicaid authority over Maryland’s imposition of strict requirements not found in the law allowing the use of such trusts. In particular, for a so-called c2B trust, Maryland will require the following:

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Power of Attorney and Advance Directive

Like the shoemaker whose children run around barefoot, there are lawyers who have no estate plan. Even more numerous are non-lawyers who have never done any estate planning. Some folks might reason that such planning is unnecessary because they don’t have vast wealth or that all of their wealth is tied up in retirement assets that will pass to their named beneficiaries. While it is true that such people may not require sophisticated estate planning, all adults would be prudent to ensure that appropriate personal and financial decisions will be made for them should they lose the ability to make such decisions themselves. There are several basic estate planning documents that enable people to appoint trusted individuals to make such decisions on their behalf.

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Maryland Changes its Medicaid Rules

Maryland has issued new regulations making significant changes to Medicaid law. These changes affect many individuals who have done Medicaid planning in the past. This article will discuss the changes and show how they might affect you. Because these new rules drastically alter the assumptions that underlay all previously considered plans, prudence suggests that all existing asset preservation plans be reconsidered. These new regulations deal with Federal rule changes and many of the points discussed below will apply in D.C. and other States as well. This office has been working to develop strategies to address these new rules. Continue reading “Maryland Changes its Medicaid Rules”